Delmarva Power seeks 15 percent rate increase

In this 2007 file photo, Barry Williams, substation supervisor with Delmarva power explains the importance of exercising safety around such structures. The company is seeking a 12.5 percent electricity rate increase to help pay for reliability improvements.(Photo: File photo)Buy Photo

Delmarva Power's 200,000 customers on the Eastern Shore would see their monthly electricity bills jump about 15 percent if regulators approve the company's latest rate request.

The increase would fetch about $66 million for the power provider, which reported $1.3 billion in operating revenue last year. That money is needed to recoup costs of recent and planned reliability upgrades, said Gary Stockbridge, Delmarva Power region president.

“Our customers are seeing better performance as a result of reliability improvements and smart infrastructure upgrades," he said. "With cost-efficiency in mind, we have made practical decisions to invest in the areas that needed to be upgraded the most.”

The new rate would raise the monthly bill of a typical customer by $21.42, from $147 to $168.

The Maryland Public Service Commission is expected to rule on the request within about seven months. If history is any guide, the board probably won't allow Delmarva Power to reap the full $66 million or anything close to it, though.

“There have been very few cases in the 28 years I’ve been here that have been give what they ask for," said Theresa Czarski, deputy people's counsel for the Maryland Office of People's Counsel, which represents residential utility customers. "Usually, it’s substantially less.”

Delmarva Power last received approval for a rate increase in 2012. Regulators allowed the company to boost bills by 3 percent to raise about $11 million in additional revenue. It had initially sought $25 million.

Since then, the company has invested $330 million in upgrading its power grid, according to a press release. The improvements included trimming trees along 860 miles of power lines and new equipment that resulted in a 51 percent decrease in the number of outages. When outages do happen, they're being resolved 69 percent quicker.

It also is trying to recoup expenses for an “advance metering” system installation that began in 2012, which the company claims has provided $1.80 in benefit to customers for each $1 in cost. The new devices allow users to get information about how they use electricity, get quicker feedback from customer service and start or turn off the flow.

Delmarva Power officials say the request is unrelated to the merger last March between its parent company, Pepco Holdings, and the utility giant Exelon. Delmarva customers are receiving a pair of $50 rate credits as a result of the merger.